Australia's Water Reform journey

Transcription

1 Australia's Water Reform journey Karl Higgins, Director Water Strategies Department of Sustainability, Environment, Water, Population and Communities

2 Distribution of Australia s run-off

3 Inflow Variability Annual Inflow (GL) Average ,000 GL/y River Murray System Inflows (Including inflows to Menindee & excluding Snowy Releases) Average /01 11,500 GL/y Average 2001/ ,800 GL/y (33% of previous average) ,900 2,000 Year Ending May

4 Water management framework State Governments Lead role for management of water issue rights to extract water (entitlements) and manage annual allocations historically, state governments encouraged irrigation development to promote economic growth water entitlements were tied to land and not tradeable over-allocation and unsustainable use of water Australian Government National frameworks, coordination and research recent expansion of powers through Water Act 2007

5 The role of the Department and key milestones in water reform To prepare Australia for a future with less water through: Development of policy to drive Australia s water reform agenda Delivery of programs aimed at improving the efficiency of water use Achieving environmental outcomes through the purchase of water Key achievements The introduction of the Water Act 2007 Assisted with the development, implementation and expansion of interstate trade The development and implementation of key regulatory instruments The establishment of the Commonwealth Environmental Water Holder

6 Australia s water reform journey: 2004 National Water Initiative (NWI) More secure entitlements, including for the environment Improved planning Improved water markets Improved water pricing Improve water accounting Commonwealth Government begins to fund water projects

7 Commonwealth Government intervenes: 2007 Commonwealth water responsibilities centralised in one portfolio Sustainable yields studies undertaken New Commonwealth powers to limit water use in the Murray- Darling Basin (Water Act 2007) New Commonwealth agencies established Murray-Darling Basin Authority Commonwealth Environmental Water Holder Bureau of Meteorology made responsible for water information nationally

8 Murray-Darling Basin Plan Sustainable limit on water extraction Environmental watering plan protect and restore environmental assets protect biodiversity and achieve other environmental outcomes Water quality and salinity management plan Draft publically released 28 November 2012

9 Water for the Future - Commonwealth funding 2007/08 ~$6 billion to improve rural water use efficiency ~$3 billion to recover water for the environment ~$1 billion to establish new functions all over 10 years ~$1.5 billion to enhance urban water security 2010 additional commitment to recover enough water for the environment to meet the environmental targets of the Basin Plan.

10 Regulation of the water markets The objective of water regulation in Australia is to assist in developing the free movement of water. The Water Act 2007 provides for water market, charge and trading rules to be made to regulate the water market and water charges across the Murray-Darling Basin The Rules are made by the Commonwealth Minister for Water and are enforced by the Australian Competition and Consumer Commission The rules aim to free up trade, encourage the efficient use of water and water service infrastructure, and improve pricing transparency and consistency across the Basin

11 Continuing water market reform As the market has matured the Government has recognised that continual policy development and implementation is required to ensure that water markets are as free and efficient as possible by: Responding to stakeholder concerns and ensuring that market confidence is maintained; Acting to eliminate market failure when it becomes apparent; Taking a dynamic approach to ensure that policy reflects the best current information; and Having an open mind toward policy and programs A dynamic approach to policy is required to incorporate new insights into the physical environment and how the market operates as it matures

12 Continuing water market reform The Australian government s water reform agenda includes: Giving the independent regulatory bodies the required mandate and powers to allow them to monitor and enforce water market rules; Improving consistency across state jurisdictions to improve the interconnectedness of the separate markets; and Reform to ensure the appropriate conduct of water market participants to improve confidence in the market Develop and introduce the National Water Market System to: reduce transaction times reduce transaction costs for users and administrators satisfy customer requirements for ready access to accurate, detailed and comprehensive information provide greater consistency of across jurisdictions

13 Sustainable Rural Water Use and Infrastructure Program $5.8 Billion over 12 years ( to ) A unique opportunity to help place irrigators, irrigation industries and communities on a better footing to deal with reduced water A minimum of 50% of the water savings are also returned to the Australian Government from a large number of the investments Works include improved planning, major system reconfiguration, upgraded metering, infrastructure upgrades in rural communities and improved on farm irrigation efficiency Projects are rolled out through delivery partners (both public and private)

14 Lessons learned Caps on water use must be based on sustainability principles Contingency planning based on risk management principles must be in place for extreme dry conditions Substantial public investment is required to achieve rapid improvements in water use efficiency Accurate price signals and effective water markets assist in adjustment

15 Lessons learned (continued): benefits of water markets Reveals the value of water encourages efficient use of water resources and water infrastructure Economic benefits gives enterprises flexibility to manage assets, cash flow and risk water trading increased gross regional product in the southern Murray-Darling Basin by $370 million in Enables the Government to achieve environmental outcomes at least cost, by purchasing water on the market.

16 Continuing challenges Getting the long term balance right between human use and protecting the environment Understanding potential adjustment issues facing water dependent communities designing appropriate policy responses Further improving water market efficiency Further improving knowledge of water systems potential effects of climate change sustainability of groundwater use potential effects of interception activities such as forestry and mining.